Medical-equipment manufacturer

Card Guard Scientific Survival

(SWX:CARDG) posted strong growth in the first quarter of 2001 in its two main areas of activity, sales of medical equipment and monitoring services.

Net profit rose to $2.1 million, 61% more than $1.3 million reported for the first quarter of 2000.

Revenues came to $21.8 million, 150% above the first quarter of 2000 but slightly down from the fourth quarter of 2000, when it brought in $24.3 million.

These results, released today, may explain why the company's stock has been so relatively stable while almost everything else is collapsing.


Oridion Systems

(SWX:ORIDN), for example, Card Guard is a "real" company with significant revenues and impressive growth. Card Guard hit the headlines last month following the successful tender offer by its shareholders, headed by

Shrem Fudim Kelner

. Despite the slump on the local market and the weakness on leading exchanges worldwide, shareholders managed to sell a huge stock block worth $120 million to the company's banker

UBS Warburg

. UBS will be distributing the shares among institutional investors.

Strong growth in the United States and Europe

In financial terms, the American market accounted for most of Card Guard's growth volume. U.S. revenues grew to $13 million in the first quarter, twice the amount posted in the first quarter of 2000.

But Europe took the cake in percentage growth. Revenues from European customers rose to $8.7 million, compared with a $1 million in the first quarter of 2000.

Card Guard's U.S. growth was generated by several acquisitions. One was Quality Diagnostic Services, which specializes in cardiac-event monitoring, bought in early 2001 for $18 million.

On January 11, 2000, Card Guard acquired cardiac-monitoring company LifeWatch for $11 million.

Card Guard says that the pilot agreement it signed with the German insurance company AOK Schleswig-Holstein will help it penetrate the promising German market. AOK's insurees are eligible for rebates on use of Card Guard products.

Besides being profit-warning-free, Card Guard's reports present a positive forecast. The company expects revenue to grow this year thanks to several projects, and has also recently won several product approvals.

Strong balance-sheet structure

Operating profit grew to $13.1 million in the first quarter of 2001. The rate of gross profit out of total revenues declined from 61.3% in the parallel to decreased to 60%.

But earnings before taxes, interest, depreciation, and amortization (EBITDA) was positive at $4.55 million, constituting 20% of revenues, compared with a positive EBITDA of $1.54 million in the first quarter of 2000, 18% of revenues.

Card Guard ends the first quarter with a markedly strong balance-sheet structure. Its shareholders equity came to $151 million out of a balance of $190 million. The company has $79 million cash and equivalents.

Card Guard is a global medical-technology company specializing in advanced medical-monitoring systems ranging from risk chronic patients up to consumers of standard health products.

Headquartered in Rehovot, Israel, Card Guard has subsidiaries in the United States, Europe, Brazil, Canada and Japan.

In November 1999, Card Guard successfully completed a $60 million IPO in Switzerland. In October 2000, it once again did well with a stock offering of $100 million.